Aussie gains again on US dollar slide

Commsec: Mid-Session 24 Jan 18

Commsec: Mid-Session 24 Jan 18

The Australian dollar reached 80.84 US cents overnight.Source:istock

THE Australian dollar is stronger against the US dollar as the greenback weakened further after the US Treasury Secretary spoke in favour of the trend. At 0630 AEDT on Thursday, the Australian dollar was worth 80.74 cents, up from 80.17 on Wednesday.

The Aussie hit a four-month high against its US counterpart, which was already showing broadbased weakness that deepened after US Treasury Secretary Steven Mnuchin in Davos said a weaker currency was beneficial to trade. The Australian dollar reached 80.84 US cents overnight — its highest since September’s two-plus year peak.

Brown Brothers Harriman global head of currency strategy Mark Chandler said Mr Mnuchin was highly unlikely to have deliberately talked the US dollar down and pointed out that US Commerce Secretary Wilbur Ross tried clarifying the statement relatively quickly.

“Mnuchin may have been the most surprised by the impact of his comments,” Mr Chandler said. “One gets a sense that he is still learning the nuances of his position and ... how the media and markets hang on every word of the Treasury Secretary, especially about the dollar.”

Meanwhile, the Aussie dollar has continued its slide against both the yen and the euro.